5 Tips to Help Students with FAFSA’s New Simplification Act

The Free Application for Federal Student Aid (FAFSA) is the gateway to federal student aid. The application underwent some recent and significant changes due to the FAFSA Simplification Act. Knowing how to work with these changes may increase your chances of getting grants, scholarships, work-study options, and low-interest-rate federal student loans to help you pay for college. Here’s what you need to know.

1. Apply Early

One of the essential FAFSA rules is still the same: Apply as early as possible. Applying early helps schools consider you for the allocations of aid. Many schools and states have limited resources. Those who apply first have a better chance of receiving grants, scholarships, and other aid types given on a first-come, first-served basis.

The FAFSA submittal process opens on October 1st of each year. Mark this date on your calendar. Even though the form is simpler, getting it done early may reduce your stress when applying.

2. Take Advantage of the Expanded Pell Grant Eligibility

One of the Simplification Act’s biggest changes is its expansion of need-based Pell Grant eligibility. This means more students from low- and middle-income families may qualify. Pell Grants are especially valuable because, unlike loans, they don’t have to be repaid.

When you fill out the FAFSA, make sure to include accurate financial information. Don’t be afraid to report high debts or low income. Under the new rules, families that earn less than certain income thresholds may automatically qualify for the greatest possible award.

3. The Student Aid Index Replaces the Expected Family Contribution

The Simplification Act trades the expected family contribution (EFC) formula for one called the Student Aid Index (SAI). The SAI calculation is designed to be more transparent and better reflect a family’s true financial need. The SAI no longer penalizes students for simultaneously having multiple siblings in college, which is one major shift from the old formula.

4. Be Aware of New Financial Aid Exclusions

The Simplification Act added several new exclusions for specific types of income. These include benefits through federal assistance programs like Medicaid and Social Security. This means if your family qualifies for assistance through one of these programs, the benefits won’t count against you for student financial aid purposes. This may make it easier to figure out what aid you might be qualified to receive.

5. Seek Professional Guidance

While the FAFSA is simpler than it was before, the financial aid process may still be overwhelming. If you’re not sure how the Simplification Act’s changes affect your financial aid eligibility, seek professional advice. School financial aid offices and financial professionals who are familiar with student aid may help you navigate the application process and clarify the changes under the new law.

Finally, some states and schools may have their own forms or deadlines. Working with an expert may help you make sure you don’t miss any important dates or opportunities when it comes to receiving student financial aid for college.

Important Disclosures:

Content in this material is for educational and general information only and not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by WriterAccess.

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